IIn the last instalment we addressed Level 4 – Team. At the Team Level, this is about developing your team in readiness to appoint a General Manager into your business.. This week we move on to Level 5 – Synergy & Level 6 – Results.
"The working together of two things to produce a result greater than the sum of the individual things".
Simply put 1 + 1 > 2
At the Synergy level, the company is now running smoothly and to keep it that way it is imperative for the owner to keep a finger on the pulse of the business. The only way the owner can assess if the business is OK is through regular reporting from the management team. For the successful organisation, it is not only a matter of creating a vision, a mission, and a strategy followed by a well thought out business plan but also implementing that plan and checking results throughout the year. This can be accomplished via the Quarterly Business Review.
The Quarterly Business Review starts with a review of the business goals:
· Are they being accomplished?
· What is the dollar impact?
· Who is accountable?
Next is an organisational review including:
· Operations (production, waste, new development)
· Sales and marketing
· Talent and time management
Based on this evaluation, the owner should have a good understanding of where the organization is currently and what still needs to be achieved. It is important to develop a plan and check each quarter that the business is meeting the stated goals. Look at the strategic plan with the owner every three months to make sure the business is on the right track. If it is not, there is still the opportunity to correct it rather than waiting for December and saying "What happened?".
Items to include in the review could be:
· Customer Input — Sales trends, new product development, component technology trends, outsourcing strategy and objectives
· Sales history of each customer
· Quality performance — Product returns, corrective actions
· Delivery performance and any issues affecting deliveries
· Program Performance — design for manufacturing, ECO, ADR, documentation
· Prototyping – Verification – Validation
· Quotations — Information required/desired, quote turnaround time, new product quote, quote of an existing product(s), quote clarity/format
· Cost reduction initiative — Cost savings, other issues (invoicing, terms, etc.)
· Inventory levels
· New Program Introductions
· Goals and objectives
To maintain a successful business the team need to work in synergy, team bonding exercises and training can help instil a feeling of family within the business which encourages a cohesive business without departmental divisions.
Many of the ActionCOACH workshops we run can help in this development and it is also great to look outside the system for team building events or get the team to organise regular team only events.
The more team members know about each other outside the workplace the quicker they are to help each other and form alliances and interdepartmental communication improves enabling the company to strive towards the same objectives and preventing interdepartmental sabotage.
To maintain a successful business, the team need to have access to ongoing skills and personal development training. Many of the ActionCOACH workshops can help in this development and it is also great to look outside the system for workshops and individual professional skills training.
A program of personal growth for each team member encourages key team members to grow with the company. This not only improves moral but also has a beneficial effect on the business as new ideas and skills are implemented.
All business owner’s must work towards having such a program for all team members as well as them self.
Statements on vision, mission, objectives, values, strategies, and goals are not just elements of future planning. They also provide benchmarks for a historical review. The starting point is to determine a company's existing (implicit or explicit) vision, mission, objectives, and strategies.
Then judge these against actual performance along the following lines:
· Is the current vision being realised?
· How has the company's mission and objectives changed over the past three months?
· Why have the changes occurred or why have no changes occurred?
· Identify primary reasons and categorize them as either internal or external.
· Describe the actual strategies followed over the past three months in respect of products/services, operations, finance, marketing, technology, management etc.
Critically examine each strategy statement by reference to activities and actions in key functional areas covering such matters as:
· How has the company been managed?
· How has the company been funded?
· How has the company sought to increase sales and market share?
· How have productivity/costs moved?
Measure each section and report on the performance achieved.
Ask the following for each:
· "why not"?
· "why only"?
· "why so"?
Locate the reasons for differences between the actual and desired performance …
“If you can learn to run one business successfully, then there is no reason you can’t run any number of businesses at the same time….the principles are still the same.” Richard Branson
At this point, the owner is a true business owner. They have a "Commercial, Profitable, Enterprise That Works Without Them."
In the Results stage you are no longer a business owner, you are an investor. You are creating multiple streams of income through businesses, real estate, and financial instruments.
There are 3 key areas in Investing:
· Buying, Building and Selling businesses
· Real Estate – Commercial and Domestic
· Stock Market
As an investor, the key is to identify which area or areas of investment that you wish to specialise in and Learn everything you can about investing. Set your goals and parameters around the key decisions factors that will ensure you maximise profits and minimise losses in your investment strategies.
We have now covered the 6 Steps to Structuring a Better Business, what have you learned through this series and what plans and actions have you put in place to enable your business to reach it’s full potential?
In business, it is always the little things that get big results. Contact Us now if you are serious about achieving the success in your business that you are not achieving at the moment ...